Highlights of Senate HELP Committee WIA Reauthorization Bill

6/27/2013

Titles I - III

The Senate Committee on Health, Education, Labor and Pensions (HELP) has circulated a draft WIA reauthorization bill, which they intend to introduce and markup in July. This document outlines the key features for community colleges of titles I - III of this bill, which have the same scope as Title I and II of the current statute. AACC’s comments and suggested changes to this legislation are available here.

The bill is nearly identical to legislation that was circulated in 2011, which in turn was largely based on a reauthorization bill that passed the Senate in 2006. The biggest change in the Senate bill is that it separates what is now Title I into two separate titles, Title I and Title II. The new Title I represents a major effort to increase program alignment seen throughout the legislation. By putting provisions concerning governing boards, plans, and common accountability measures into a Title that applies to all of the “core programs” that are authorized in WIA, the HELP committee would set up a more unified framework for these programs that will allow and encourage them to better align and combine their services for program participants.

The following are selected highlights from the 2013 legislation, noting in appropriate places what has changed in the current bill from the 2011 draft.

Title I – System Alignment and Innovation

Definitions

The new Title I contains definitions of terms that apply across what the bill now refers to as the “core programs” (not to be confused with “core services”). The core programs are the principal programs that are authorized under WIA itself, i.e. the formula occupational programs authorized in the new Title II, adult education and literacy in Title III, Wagner Peyser employment service programs in Title IV, and the vocational rehabilitation programs now housed in Title V. Other notable new or changed definitions include:

Career pathway: The bill contains a definition of career pathway, a term not used in the current statute. This new definition is indicative of the fact that career pathways are emphasized throughout the legislation. The definition itself is consistent with career pathways definitions used elsewhere. It specifically provides for programs that blend education and workforce preparation activities.

The definition of customized training is modified to replace a hard requirement that the employer pays at least 50% of the cost of the training with one that requires the employer to pay a “significant portion of the cost of training” as determined by the local board, based on a number of factors.

In-demand industry sector or occupation is a term used throughout the bill and is defined in terms of the sector or occupation’s impact on the regional economy, jobs that provide family-sustaining wages and benefits, and opportunities for career advancement.

Individual with a barrier to employment is a new catch-all term that encompasses a number of different groups, many of which are individually defined as well, including displaced homemakers, English-language learners, current or former foster youth, migrant and seasonal farmworkers, etc.

Industry or sector partnership is another new entry, and one that features prominently in the legislation. In the WIA context, these partnerships are led by state or local boards, and include as a required partner one or more representatives from an institution of higher education with education or training programs that support the industry cluster.

Institution of higher education is now defined replacing “postsecondary educational institution.” The WIA definition encompasses public, non-profit and for-profit institutions, as under current law.

The definition of low-income individual as well as other terms and provisions that base their definitions in part on the poverty line, now refer to 150% of the poverty line, rather than the line itself.

Recognized postsecondary credential, another term used often in the legislation, is defined as a “credential consisting of an industry-recognized certificate, a certificate of completion of an apprenticeship, or an associate or baccalaureate degree.” The definition does not include certifications and it is unclear exactly how broad the meaning of “industry-recognized certificate” is in this context. AACC will seek clarification and modification of this term.

Subtitle A – Workforce Boards and Plans

State Workforce Investment Board Makeup and Responsibilities: The legislation makes substantial changes to the makeup of the state WIB. Most notably, there would no longer be a requirement that the state WIB be chaired by a business representative, but unlike the 2011 draft bill this legislation would maintain the business majority currently required. There is also more language in the 2013 bill specifying that business board members come from industries that offer high quality opportunities for workers, including pathways for advancement and work-relevant training and advancement. At least 20% of the board must be representatives of the workforce (which must include labor organizations), and the balance of the board must be representatives of government. The latter category must include the lead state officials with primary responsibility for the core programs, chief elected officials and a representative from a registered joint labor-management apprenticeship program (a new requirement in the 2013 bill). It may include, among other things, “State agency officials responsible for education programs in the State, including chief executive officers of community colleges and other institutions of higher education.” Currently, representatives of groups that have experience in the delivery of workforce investment activities, including community college CEOs, are a required component of the state board.

The functions of the state board are greatly expanded compared to current law. Many of the additional functions of the board relate to increasing alignment between the core programs and other partner programs. The bill makes it a function of the State WIB to review and provide comment on the State plans of all the one-stop partner programs in order to provide strategic leadership and foster alignment between these programs and the core programs. State WIBs would be charged with developing guidance on ways to remove barriers to greater coordination among system programs, the development of career pathways, and innovative workforce strategies. The boards would also identify and disseminate information on best practices related to the effective operation of one-stop centers and effective local boards. State WIBs would also be charged with developing policies relating to the appropriate roles and contributions of one-stop partner programs. New to the 2013 bill, state boards would also be tasked with the design and implementation of integrated data systems to improve coordination of services (such as intake, performance tracking, etc.) across workforce development programs

States may use alternative entities, including pre-existing state workforce development boards, that are substantially similar to the board described in this bill.

Unified State Plan

Under the Senate bill, states would file to the Secretaries of Labor and Education a unified 4-year state plan that covers all the core programs. Here, too, there is increased emphasis on strategic planning and increased program alignment, both among the core programs and with other workforce development programs that do not fall under the plan. “Strategic planning elements” are laid out separately from “operational planning elements.” There is an emphasis on concurrently providing occupational and adult education services to individuals who need both, and on implementation of career pathways. The operational elements of the plan also emphasize coordination, as well as assessment of the core and partner programs. Notably, the plan must detail how the lead state agencies will align and integrate workforce and education data.

States also have the ability to submit a combined state plan that covers the core programs and one or more of the mandatory partner programs, including Perkins CTE programs at the postsecondary level.

Chapter 2 – Local Provisions

Local Workforce Development Areas

The process for designation of local areas is similar to current law. Governors shall initially continue designation of current local areas at their request and if they performed successfully and sustained fiscal integrity. Those conditions apply to designation in the third program year and beyond, as well as taking part in any required regional planning.

States are required to identify regions in the state, and in any region that encompasses two or more local areas, those local boards must engage in regional planning and coordinated service delivery. These boards must submit regional plans to the state. These regions may be interstate.

Local WIBs

Compared to state WIBs, the bill would make relatively fewer changes to the composition of local boards. Local boards would still be business-led and business-majority. The bill would, for the first time, put percentage minimums on other members of the board. As under the 2011 bill, at least 20% must be representatives of the workforce (including labor). The board also must include representatives of entities administering education and training activities. This category must “include a representative of institutions of higher education providing workforce investment activities (including community colleges).” As with the state boards, this category now includes required representation of a joint labor-management apprenticeship program. The board must also include governmental and economic and community development entities. One potentially significant change from the 2011 bill is that there is no longer a requirement that at least 10% of the board come each of the education and government categories. This potentially allows for a greater business majority than would be possible under the 2011 bill, where at least 40% of the board would have to come from the “non-business” categories.

One-stop partners would no longer necessarily be on the board, but may participate in one of the standing committees that would be more devoted to operational details than the board itself. The current youth council would become another one of these committees.

As with the state board, the local board’s functions would be augmented to make the boards more strategic, place a greater emphasis on employer engagement, and lead to the development of career pathways, among other things. There is also a new requirement that local WIBs coordinate activities with and among education and training providers in the area, including board review of applications to provide adult education and literacy programs in the area.

Local Plans

Also like its state counterpart, the local plan would be greatly augmented, in similar ways. Plans would be for four years, with required reviews after 2 years. Here, too, the bill emphasizes greater collection and analysis of local economic data in plan formation, implementation of career pathways, dual enrollment in more than one of the core programs, employer engagement, and entrepreneurial skills.

Subtitle B – Workforce Development Performance Accountability System

The Senate bill would establish one set of accountability measures to assess statewide performance on all of the core programs and local performance on the (new) Title II programs. They are generally similar in nature to the current performance indicators. The point at which the “snapshots” are taken for the first three indicators has been changed from the 2011 bill, and in general are less flexible than they would have been under the previous bill. The six primary indicators of performance for adults are:

The percentage of program participants who are employed during the second quarter after exit from the program.

The percentage of program participants who are employed during fourth quarter after exit.

The median earnings of program participants who are employed during the second quarter after exit.

The percentage of program participants who obtain a recognized postsecondary credential, or a secondary school diploma or its recognized equivalent (but only if they have obtained employment or are enrolled in a postsecondary program within one year of exiting the program), during participation in or within one year after exit from the program.

The percentage of program participants who, during a program year, are in an education or training program that leads to a recognized postsecondary credential or employment and who are achieving measurable skill gains toward such a credential or employment.

Indicators of effectiveness in serving employers that will be devised by the Secretaries of Labor and Education.

As under current law, a state may implement additional indicators. The Secretaries of Labor and Education are charged with specifically defining these indicators, in consultation with various stakeholders. The local indicators for the youth, adult and dislocated worker programs are the same as the applicable state indicators, plus any additional indicators.

Eligible training providers performance reports would include information on each program’s performance with respect to the first four of the indicators described above, as well as the total number of adults and dislocated workers served and the number of individuals with barriers to employment as defined in the bill, disaggregated by subpopulation.

DOL and ED must also establish measures for overall system.

Subtitle C – Workforce Innovation and Replication Grants

The bill authorizes the workforce innovation grants that were originally proposed by the administration and funded for the first time in FY 2011. The authorization provides that funding would come from the funding for the core programs, but only in situations where funding for those programs exceeds that of FY 2010. The grants are to support innovative new strategies or the replication of proven strategies to align programs and strengthen the workforce system in a state or region in order to substantially improve education and employment outcomes for adults and youth served by the system. Entities eligible to receive grants are state partnerships and regional entities. There are also youth innovation and replication grants. For the first program year after enactment, there would also be transition grants available to states and local areas to assist them in making the transition to the new requirements of this bill.

Title II – Workforce Investment and Related Activities

Sec. 221 – Establishment of One-Stop Delivery Systems

The establishment and operation of the one-stop system would not differ significantly from current law, with the exception of infrastructure expenses as detailed below. As under current law, the bill establishes mandatory partners that must participate in the operation of the one-stop centers. The list of mandatory partners is slightly longer than in current law, but for community colleges, the most relevant one remains Perkins Act career and technical education programs at the postsecondary level. Additional partners may also be named, and the list of potential additional partners has several new additions in the Senate bill.

As is now the case, the one-stop partners are charged with entering into a memorandum of understanding (MOU) to detail how the one-stop system will be operated in the local area. The required contents of the MOU are similar to current law, but allow specifically for in-kind contributions from partners and contributions from philanthropies and other private entities. There is also a requirement that MOUs be reviewed at least every two years.

The bill lays out substantially similar (if not identical) provisions governing cost-sharing of one-top infrastructure funding as those included in the 2006 Senate bill. Local areas would have two options to fund infrastructure costs:

Local option – If all the partners and the local WIB and the local elected officials can come to an agreement, local areas can fund their infrastructure costs through MOUs. If there is no agreement, that area will have to use the state mechanism.

State infrastructure funding mechanism – To cover the infrastructure costs of those areas that were not able to come to agreement at the local level, the Governor would determine the portion of such costs that would come from each of the partner programs at the state level. Governors must base these amounts on the partner programs’ proportionate use of the one-stop centers in the state and exclude the portion of funds attributable to local areas that use the local option. These funds must come from the partner program’s administrative funds, and would be capped. For Perkins, the cap would be 1.5%. The governor must establish and appeal process for a partner program to appeal its share of infrastructure spending as determined by the state. The governor would then allocate these funds to local areas that did not establish MOUs under a formula developed by the state WIB. Infrastructure costs means the non-personnel costs that are necessary for the general operation of the one-stop center, including rent, utilities, etc. Partner programs must determine their share of other costs of running the centers through MOUs, with guidance from the state board on each programs’ contribution.

Provisions governing the designation and certification of one-stop center operators are largely the same as current law. Each one-stop system would be required to use a common one-stop delivery system identifier, essentially a national brand of sorts. The Secretary of Labor is tasked with developing the identifier. State boards are charged with developing criteria to be used in assessing the performance of one-stop centers.

Sec. 222 – Identification of Eligible Providers of Training Services

Community colleges have cited the current system for determining trainer provider eligibility as a disincentive to becoming more involved in the workforce system. The Senate bill improves upon current law in this area. As under current law, the governor would establish criteria, information requirements and procedures for a training provider to be included on the eligible programs list.

In devising eligibility criteria, governors directed to take into account a number of factors, including:

The performance accountability information supplied by the providers, which details performance outcomes for those individuals receiving WIA training services, information on recognized postsecondary credentials received by WIA participants, information on program costs and information on program completion rate for WIA participants. Notably, the requirements here specifically apply to WIA participants, unlike current law where maintaining eligibility required reporting on every student in a program. However, the governor is also directed to consider other appropriate measures of performance outcomes when devising the criteria, “and the outcomes of the program through which those training services were provided for students in general with respect to entry into employment and earnings at such entry.” This last clause brings back in the aspect of the current eligibility scheme that community colleges find most problematic.

Other things the governor must take into account when devising the criteria:

The need to ensure access to training services throughout the State.

Information reported to state agencies with respect to other training programs.

The licensing status of training providers, and the requirements for that licensing.

Ways in which the criteria can encourage providers to use industry-recognized certificates.

The ability of the providers to offer programs that lead to recognized postsecondary credentials.

The quality of a program of training services.

The ability of providers to provide training services to individuals who are employed and individuals with barriers to employment.

Other factors the governor deems appropriate to ensure, amongst other things, that the collection of information required to demonstrate compliance with the criteria is not unduly burdensome or costly to providers.

Local areas are able to establish criteria and information requirements in addition to those established by the governor.

The bill retains the concept of initial eligibility to enable programs in in-demand and emerging industries to be quickly approved. A provider who has not previously been and eligible provider of training services needs to provide program-specific performance information based on criteria that include at least:

A factor related to the WIA accountability measures.

A factor concerning whether the provider is in a partnership with business.

Other factors that indicate high quality training services; and

A factor concerning alignment of the training services with industries projected to have potential for employment opportunities.

The language seems to suggest that new programs at institutions that have other programs on the eligibility list would not be able to take advantage of initial eligibility.

States and local areas would devise the procedures that trainers must follow in order to be included on the eligible provider list. The list and the accompanying information provided by trainers would be made available to WIA participants.

Governors are authorized to establish transition procedures under which current providers may remain eligible until the end of 2013 at the latest. The procedures established by the governor must provide for biennial review of trainer eligibility.

The formula allocation among states for the adult and dislocated worker programs are modified up front by a provisions that would reserve 50 percent of the excess of the current fiscal year’s appropriation over the appropriation for FY 2010 (up to $250,000) for the workforce innovation grants authorized in Title I.

The adult formula is modified to more heavily weigh the relative number of unemployed individuals in areas of substantial unemployment, weigh the relative size of the state’s labor force, and put slightly more weight on the relative number of disadvantaged adults in a state. The formula for the dislocated worker program remains the same. Both formulas contain new language on minimum and maximum allotments. The within-state allocation formulas mirror their national counterparts.

Local boards would be given authority to transfer up to 50% of the adult funds to dislocated workers, and vice versa (down from 100% in the 2011 bill). Current law caps this transfer authority at 20% (although it was usually increased in the appropriations process).

Statewide Employment and Training Activities

There are several new additions to both the required and allowable statewide activities. Notable ones for community colleges include:

Disseminating performance information and information on costs at training programs to WIA participants.

Implementing innovative programs and strategies designed to meet the needs of businesses, including incumbent worker training, customized training and industry sector strategies.

Providing career ladder and career pathway programs

Providing microenterprise and entrepreneurial training and support programs.

Local Employment and Training Activities

Likewise, there are several new additions to authorized local activities. In general use of funds, localities would have to designate a dedicated business liaison to establish and develop relationships with local businesses.

Core services are expanded somewhat, including the provision of referrals to and coordination with other programs and services, within and without the one-stop delivery system.

The bill includes language in the sections on intensive and training services that clearly states that there is no so-called “sequence of services.”

The training services provisions expands the authority for local areas to use contracts for training services rather than individual training accounts (ITAs) to cases where the local WIB determines it would be most appropriate to award a training contract in order to facilitate the training of multiple individuals in in-demand industry sectors or occupations and such contract does not limit consumer choice. There is also a new rule of construction saying that nothing in this section should be construed to preclude the combined use of ITAs and training contracts, including arrangements that allow individuals receiving ITAs to obtain training services that are contracted for.

There is new language governing the amount the governor or local board may reimburse firms for on-the-job training.

There are many additions to the list of permissible local workforce activities, several of which revolve around improving coordination between different programs and services. Others include provisions to increase business engagement, implementation of industry sector strategies, and development and delivery of innovative workforce strategies.

Sec. 270 Demonstration, Pilot Research and Multistate Projects

The section dealing with national projects has been largely rewritten, with numerous additional types of projects that may be funded by the DOL. Some notable additions include career ladder projects, industry sector projects in industries with high growth rates, high-demand health care sector, nursing care and early childhood education provider training, projects for older workers and retention grants.

Programs that were added to WIA by the Green Jobs Act of 2007 are retained in the Senate bill, as well as a program for integrated workforce training and English language programs.

The Community Based Job Training Grants are also authorized in this bill, using similar, if not the same language that was used in the previous Senate bill.

Title III – Adult Education and Literacy

The significant changes that the Senate bill would make to the adult education programs are largely ones that modify and expand the focus of adult education, particularly to include the transition to postsecondary education and training and employment as end goals of the activities funded by the Act. Under the new accountability and planning structure in the Senate bill, this title no longer has its own performance indicators. Instead, the programs are to be measured under the indicators laid out in Title I, which apply to all of the core programs. There is also a significant emphasis in this title, as there is in Title I and Title II, on coordination between adult and occupational education, including co-enrollment between the two programs.

Operationally, the program would function in much the same way as it does currently, with funds flowing from the federal level to state eligible agencies, which then award funds to eligible providers (which are largely defined as they are currently). One exception to this rule is that the Secretary of Education would receive 12% of the appropriated funds to formula awards to states for integrated English literacy and civics education, with a minimum award of $60,000 to each state. Something similar to this has been accomplished through the appropriations process for several years.